Menendez: NJ Sandy Rebuilding Aid Must Be Speeded

Government officials must speed the way home rebuilding aid is getting to thousands of New Jersey victims of Superstorm Sandy, which can be done in part by revamping a burdensome application process, a senator from the storm-battered state said Wednesday.

Superstorm Sandy (Bruce Bennett, Getty Images)

"The problems here have been much larger, lasted much longer than the people of New Jersey should have to accept," U.S. Sen. Robert Menendez, D-N.J., said at a hearing of a Senate Banking housing subcommittee that he chairs.

Menendez said 12,000 people have gotten preliminary approval for aid under New Jersey's largest federally funded home rebuilding effort, the Reconstruction, Rehabilitation, Elevation and Mitigation program. But only 2,700 have been told they can begin construction -- more than 16 months after the storm caused devastation along the East Coast.

The state, meanwhile, announced one change designed to get money to recipients faster. Those using their own contractors to rebuild homes can request 50 percent of their grant in advance under the change, which went into effect Monday.

Menendez said part of the problem has been that state officials have placed federally required environmental and historic preservation reviews at the end of the lengthy aid application process. That delays rebuilding because federal rules allow reconstruction work to begin once those reviews are completed, he said.

Federal Housing and Urban Development Secretary Shaun Donovan told the subcommittee that New Jersey officials could reorder the application process, performing the environmental and historic reviews early on, without automatically jeopardizing federal aid.

Complaints about lost applications, long delays, lack of information and other problems in the aid distribution process have been rampant in New Jersey. In recent weeks, Gov. Chris Christie's administration quietly terminated the state's $68 million contract with Hammerman & Gainer Inc. because it was unhappy with how the company was handling applications for housing recovery aid.

Menendez said the company has billed New Jersey for $51 million for just a few months of work under what was supposed to be a three-year contract, calling it "mind-boggling."

"That cannot be the case," Menendez said of the company's requested payment. "I assure you that will not be the case."

The senator said he was hoping an upcoming review of Sandy recovery efforts by Donovan's agency would include "any urging of the state to go after the contractor."

Donovan said that as of January, the Federal Emergency Management Agency and Small Business Administration had helped more than 265,000 U.S. families and businesses hurt by Sandy. He also said more than 99 percent of federal flood insurance claims related to Sandy had been paid out, totaling nearly $8 billion.

But he acknowledged, "The recovery can never happen fast enough for the Americans who have been affected."

In his written testimony, Donovan said that in early March 2013 -- less than two months after Congress approved an aid package for Sandy recovery -- his agency issued guidelines for how local agencies could use the money.

Donovan said that while three agencies had submitted plans for using the money to his department by early May, "Some grantees have been more aggressive in accessing" their money than others.